SGX ups pro-rata renounceable rights issue cap to 100% of share capital

SINGAPORE Exchange (SGX) on Monday said it would allow companies to seek a general mandate for an issue of pro-rata renounceable rights shares of up to 100 per cent of share capital. This is up from 50 per cent, previously.

The bourse operator said this would allow companies to raise funds quickly for expansion activities or working capital.

"Recognising that listed companies have to be responsive to current global developments including the emergence of disruptive forces and economic restructuring, we are enhancing this fund-raising avenue," said Tan Boon Gin, chief regulatory officer of SGX, in a media release.

"We will closely monitor disclosures of companies tapping the market via enhanced rights issues. Investors should actively participate in the whole process including taking part in the shareholder vote."

SGX added that the boards of companies proposing such a rights issue must ensure that it is in the interests of the issuer and its shareholders.

Companies must also make periodic announcements on the use of the proceeds as and when the funds are materially disbursed, and provide a status report on the use of proceeds in the annual report.

The rights shares arising from the enhanced rights issue limit must be listed and issued by Dec 31, 2018.